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Old 17.09.2016, 00:39
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Insurance to provide pension if invalid

I have the following case to present:

37 year old male, healthy, married with 2 kids, self-employed, pays AHV contributions (1st pillar) but does not have a 2nd pillar insurance.
His total savings (in current account) including 3d pillar (in simple bank accounts) are approximately 150k. He has only been in Switzerland for 2.5 years (so that the cover by AHV is pretty low).

He is trying to hedge the risks of him:
a) dying --> This is easy, a yearly insurance to cover death risk only with payoff 250k in the event of death only costs about 200CHF/year (offer from SwissLife). 250k is not a lot of money, but given that the mother works full-time and has a good income, this payoff is enough.

b) having an accident and becoming unable to work --> AHV would pay a very small sum only, which is not sufficient to maintain the family standards of living. How to cover this risk?

c) getting sick and becoming unable to work --> Same question...

He is currently considering a mixed 3a life insurance offer by Axa. His wife () thinks that the terms in the offer are horrible [*] and is trying to present a better insurance portfolio.
[*] Seriously, I could not believe my eyes once I started reading the proposal by the very friendly and seemingly sympathetic advisor. I even felt a bit offended after reading the contract ("do I look stupid? is it because I am a foreigner?").

Thanks for sharing your experience, especially from those who have taken the path of being self-employed.
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Old 17.09.2016, 01:55
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Re: Insurance to provide pension if invalid

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b) having an accident and becoming unable to work --> AHV would pay a very small sum only, which is not sufficient to maintain the family standards of living. How to cover this risk?
In addition to AHV, there's UVG (usually through health insurer if self employed) which should also pay some pension in case of an accident, but not illness.

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c) getting sick and becoming unable to work --> Same question...
Many insurances sell this as a standalone product - Erwerbsunfähigkeitsversicherung, or in combination with life insurance.

But yeah, you need to pay very close attention to the terms, especially for life insurances. Especially cancellation is often heavily penalized, and who knows whether you'll still need this insurance in a few years: you could be employed by then, or decide that premiums are too expensive, or move out of Switzerland.
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3a pillar, insurance, pension, risk insurance




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